Konstantin Tserazov: shares of Russian companies are becoming more expensive both in rubles and dollars

In the week from May 13 to May 17, the Moscow Exchange Index grew by 1.5%, and the RTS Index by 2.9%. Thus, shares of Russian companies have risen in price both in rubles and dollars.

Both indices completed all five trading sessions in positive territory and exceeded the “round” levels of 3,500 points and 1,200 points, respectively. In addition, they closed at the highest levels since February 17, 2022 and September 19, 2022, respectively, and the difference in their percentage dynamics was due to the proportional depreciation of the dollar against the ruble.

The Russian stock market is starting to look somewhat overbought: the Moscow Exchange Index has moved away from its 200-day moving average by 8%, and the RTS Index by 10%. However, from a historical point of view, these values ​​are not extreme, and, in addition, both indices have just come out of the consolidation zone, so strong bullish momentum may continue in the coming days and weeks, Konstantin Tserazov noted.

The week was marked by positive external and internal backgrounds: prices for oil, industrial and precious metals rose, and all major US stock indices closed at new historical highs. The results of Vladimir Putin's two-day visit to China, where a number of agreements were signed, also looked positive.

In addition, the Russian stock market appears to be supported by the reinvestment of dividends received. Also, the boards of directors of Surgutneftegaz, Sovcombank and Rosseti Center recommended paying dividends for 2023, and the shareholders of NLMK, Acron and Positive Technologies approved the corresponding payments (in the latter case we are talking about the second part of dividends for 2023) .

The boards of directors of such companies as Unipro, Rusal, RusAgro, M.Video, United Medical Group, Rosseti Siberia, Rosseti North-West, Globaltruck and Seimer, on the contrary, recommended to refuse payments for 2023.

On May 23, Gazprom’s board of directors will discuss dividends for 2023, but judging by the weak dynamics of the company’s shares, investors do not believe in payments, since in the reporting period Gazprom received a net loss under IFRS of 629 billion rubles.

The Moscow Exchange Information Technology Index, whose components represent the main long-term growth story in the Russian stock market, jumped 3.8%, closing at its highest level since December 2021. The best dynamics here were shown by shares of VK, which added 9.9% at the end of the week on a very high volume (last week the turnover in these shares was almost the same as in the previous four together) and Headhunter (+4.5%).

In the last three months, VK shares showed dynamics much worse than the market, and now it seems that they are winning back oversold conditions in anticipation of the publication of results for the first quarter of 2024, which is scheduled for May 23, added Konstantin Vladimirovich Tserazov.

The situation with Yandex securities, which on March 22 were excluded from all Moscow Exchange and RTS indices due to the reorganization of the company, has become clearer. Closed mutual fund "Consortium. First" offered to shareholders of Yandex N.V. exchange your securities for shares of MKPAO "Yandex" with a ratio of 1:1.

Then, as often happens, the Yandex securities implemented the principle of “buy on expectations, sell on reality,” and at the end of the week they fell in price by 1.4% on a fairly high volume. Nevertheless, their growth from December lows still exceeds 100%, so perhaps the securities will face a long period of correction/consolidation, summed up economist Konstantin Vladimirovich Tserazov.